Analysis of Management Accounting Issues at Han's Cafe - ACC305 Report

This report analyzes the management accounting issues at Han's Cafe Rockingham, based on a news article discussing worker exploitation and financial penalties. The memorandum addresses concerns raised by the Fair Work Ombudsman regarding underpayment of staff, particularly young and migrant workers, and the repeated breaches of workplace laws by the former general manager and franchisee. The report highlights the fines and liquidations faced by the cafe due to these issues. It emphasizes the need for Han's Cafe to restructure its operations to avoid further breaches of payslip laws and improve worker treatment to enhance productivity and reputation. The analysis includes references to relevant literature on management accounting and workplace issues.

Running Head: MANAGEMENT ACCOUNTING
MANAGEMENT ACCOUNTING
Name of the Student
Name of the University
Author Note

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Table of Contents
Memorandum.............................................................................................................................2
Reference....................................................................................................................................6

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Memorandum
To: Board of Directors
From:
CC:
Date:
Subject: Management Issues of Han’s Café Rockingham
Management accounting is the internal function of business that is responsible for reporting
the financial information to owners of business. The companies uses management accounting
more often as the support tool for managing business. In this memorandum, management
issues analysis are done to assist board of directors of Rockingham Han’s Café in order to
focus on operations of organizations. These issues helps in assisting company’s management
to use provisions of accounting information (Nørreklit 2017). It ensures the management that
better information is provided for deciding matters and concerns, which ate within
organization to aid managerial functions as well as performance of organization. The news
article published on January 7, 2020 has highlighted the major managerial issues or concerns
faced by the Rockingham Han’s Café (The Sydney Morning Herald. 2020).
Han’s Café Rockingham is one of the most popular Asian chain of restaurant that is
renowned for their best wider variety of the foods of eastern cultures. This café is best known
for serving the pan of Asian soups, stir fries and curries plus the fare of standard café in the
modern surrounds. Han’s Café is the popular restaurant franchise of Asia, which has been
operating since 90s in the WA (Hanscafe.com.au. 2020).
The article relates to Han’s Café Rockingham, in which the concerns have been highlighted
that former bosses of Han’s café has faced bigger fines over the alleged exploitation of

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worker. The former general manager and franchisee are facing the penalties ten times more
than the earlier fines levels, they have been slapped with for the allegations of worker’s
exploitation. The success story of the Han’s Café has been ended. The franchises of Han’s
Café have been hardly hit with the big fines after underpayment of staff $100,000 over years.
This almost comes after three cafes that was owned by founder of popular restaurants chain
went into the liquidations along with company of management, which has leaved just dozen
franchises in the Perth. The article has stated that there are allegations that former general
manager of the outlet Cuc Thi Thu Pham and Tac Pham Pty Ltd. has breached laws of pay
slip and underpaid eleven employees, consisting of young and migrant workers that is $5022
in between “October 2017 and April 2018”. Since, employees have been paid back, however,
Ombudsman is using the serious provisions of contraventions due to the fact that Tac Pham
and Ms. Pham have been earlier pursued for the breach of the law of workplace (Mouritsen
and Kreiner 2016).
In first for Western Asian, the Fair Work Ombudsman has been using provisions of serious
violations to protect vulnerable laws of workers in Federal Circuit Court, given the alleged
repeat offending. Previous year, Ombudsman has secured total amount of amount $45,000
penalties in the court against Ms Pham and Tac Pham Pty Ltd. because of breaching of
payslip law and twenty-two staff of Rockingham were being underpaid the amount of
$27,920 in between 2014-2015 (Wagenhofer 2016). The provisions of serious contravention
have carried the penalties up to $126,000 for individuals and $630,000 per breach for
company. This is third time that provisions have been nationally used and the first in the
Western Asian (Hopper and Bui 2016).
Ombudsman, Mr. Sandra Parker has stated that increased maximum number of penalties were
brought in following concerns of community regarding the Australian workers exploitation.
The employers are on the notice that the Fair Work Ombudsman has make full use of the

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protection of the laws of helpless workers for ensuring that any entities or individuals, who
have committed serious violations have been held to the account. The allegations of Han’s
Rockingham regarding was when alleged inspectors investigated business during the
campaign of auditing (Nelson and Rupar 2015). In addition to the penalties for the alleged
serious breaches, penalties have been faced by Tac Pham Pty Ltd. up to the amount of
$63,000 per contraventions for the other alleged breaches and penalties up to the amount of
$12,600 per contravention has been faced by Ms. Pham for the other alleged contravention.
The hearing direction is being listed in Perth’s Federal Circuit court on the February 13, 2020
(Chenhall and Moers 2015).
The allegations regarding workers’ exploitations has come after fines for the similar breaches
against founder of Asian restaurants chains, Tram Hoang Han, who has lost her three cafes as
well as management firm after the underpayment of staff. Recently, Ms Han has placed
advertisement in “The West Australian”, in which he has claimed regarding problems at her
café that are consists of $37,000 in the underpaid wages, allegations of the workplace
violence and unpaid tax did not extended to remaining franchises. However, there was
allegations by Fair Work Ombudsman that at the café of Rockingham, there were total 22
underpaid employees, which included nine aged between seventeen to nineteen and seven
workers from the Vietnam. There was also claim by ombudsman that employees were being
underpaid minimum rates for the ordinary hours and they were short-changed allowance of
split-shift and rates of penalty for late night work public holiday and weekend (Chan 2015).
Hence, it has been analyzed that the allegations of underpayment of workers and their
exploitations are not new to the franchisees of Han’s Café. The allegations and charging of
penalties by Fair Work Ombudsman has been continuously done over the years. Therefore, it
can be said that Han’s Café Rockingham needs to restructure their cafes. This would be
possible if these cafés should stop breaching of payslip law. They should make an effort for

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committing no serious contraventions, as it will increase the attrition of workers and decrease
the reputation of the most popular café over decades. Han’s Café Rockingham should treat
their workers in good manner and the needs or requirements of these workers should be kept
in mind, as it will increase the productivity of workers, which ultimately increase the
performance of café as whole.

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Reference
Chan, J.L., 2015. New development: China promotes government financial accounting and
management accounting. Public Money & Management, 35(6), pp.451-454.
Chenhall, R.H. and Moers, F., 2015. The role of innovation in the evolution of management
accounting and its integration into management control. Accounting, Organizations and
Society, 47, pp.1-13.
Hanscafe.com.au. 2020. Menu. [online] Available at: https://hanscafe.com.au/menu
[Accessed 27 Jan. 2020].
Hopper, T. and Bui, B., 2016. Has management accounting research been
critical?. Management Accounting Research, 31, pp.10-30.
Mouritsen, J. and Kreiner, K., 2016. Accounting, decisions and promises. Accounting,
Organizations and Society, 49, pp.21-31.
Nelson, M.W. and Rupar, K.K., 2015. Numerical formats within risk disclosures and the
moderating effect of investors' concerns about management discretion. The Accounting
Review, 90(3), pp.1149-1168.
Nørreklit, H. ed., 2017. A philosophy of management accounting: A pragmatic constructivist
approach. Taylor & Francis.
The Sydney Morning Herald. 2020. Former Han's bosses face bigger fines over alleged
repeated worker exploitation. [online] Available at:
https://www.smh.com.au/national/western-australia/former-hans-bosses-face-bigger-fines-
over-alleged-repeated-worker-exploitation-20200107-p53phh.html [Accessed 27 Jan. 2020].

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Wagenhofer, A., 2016. Exploiting regulatory changes for research in management
accounting. Management Accounting Research, 31, pp.112-117.